If wishes were horses Swiss would swoop on Zeneca

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The Independent Online
If wishful thinking could drum up takeover action the stock market would have got the corporate activity it craves. Zeneca and Lloyds Abbey Life were the two targets drawn back into the bid frame with HSBC and the General Electric Co cast in the role of predators.

Swiss buying, that legendary influence detected ahead of so many large bids, started the latest Zeneca rush. In busy trading the shares were at one time 82.5p higher; they closed at 1,590p, up 46.5p. Roche, the Swiss group is the market's favoured predator. Bayer, the German group, was also caught in the excitement but was quick to distance itself from the rumour.

The Zeneca story has gathered an element of self-feeding. Many fund managers sold Wellcome ahead of the Glaxo strike and they are reluctant to make the same mistake again. So they are tempted to hang on, despite rich paper profits. The rumours are so strong, so persistent that it will be astonishing if the drugs group is not soon engulfed in corporate action.

Lloyds Abbey Life is another frequently drawn into the rumour mill. The Lloyds TSB banking group already owns 62.6 per cent and in some quarters is thought to be intent on mopping up the minority interest. Another yarn, however, is that it intends to pump the insurance interests it acquired with TSB into LAL, lifting its stake to around 75 per cent. The LAL shares rose 11.5p to 592.p.

HSBC, the old Hong Kong & Shanghai Banking Corporation which embraces Midland Bank, was said to be on the verge of pouncing on a German bank as part of its strategy of reducing its dependence on Hong Kong. HSBC was 24p up at 1,209p.

GEC was accorded a 4p gain to 396p on rumours it too planned a Continental swoop.

The re-emergence of bid speculation had a predictably beneficial impact on the FT-SE 100 index, driving it 18.6 points higher at 3,974.3. At one time it was 32 stronger. But it was very much a blue chips race; the supporting 250 index fell 6.1 to 4,427.5.

New York offered no support with US statistics inhibiting Wall Street.

Part of the gain was probably due to technical considerations ahead of today's expiry of the September futures contract with some dealers scrambling to square their positions. There was further excitement when Goldman Sachs remained trading for a few minutes after the rest of the market had closed, prompting speculation about its futures exposure.

Rentokil gained 13.5p to 442p following investment presentations in Scotland and Cable & Wireless was helped 8p higher to 457p on suspected Kleinwort Benson and Goldman Sachs support.

Imperial Chemical Industries, at one time 8.5p higher, ended 7p down at 840.5p on US selling; BAT Industries put on 5.5p to 465.5p on Barclays de Zoete Wedd buy advice.

Alpha Airports was unchanged at 109.5p despite rumours of asset sell- offs and a suggestion a Canadian group was near to buying Granada's 25 per cent interest.

British Airways climbed 14p to 541p on its cost savings proposals.

Matthew Clark continued to search for a new level after last week's crash following the company's disastrous problems with alcopops. The slide occurred despite determined buying by PDFM and a clutch of small investors. Sharelink, the execution-only stockbroker which accounts for about one in 10 share deals, revealed the cider group had become the second most popular share among its army of small investors. Easynet, the Internet provider which has had a highly volatile time, was the most keenly sought share.

Matthew Clark fell a further 6p to 357.5p and Easynet, which has moved between extremes of 38.5p and 81.5p as worries about figures gave way to an encouraging Microsoft deal fell 7.5p to 70p.

RMC slumped 42p to 1,110.5p on its German setback; Redland fell 9.5p to 455.5p in sympathy. Pilkington, the glass group, cracked 3.5p to 195p on rumoured Cazenove caution.

Go-Ahead, the transport group, travelled 40p higher to 367.5p as Panmure Gordon placed 2.3 million shares at 305p to help finance the Thames Trains franchise.

TLS Range, the vehicle hire group, was firm at 90.5p. There is talk of a bid, with Cowie thought to be interested.

Emerald Energy held at 2.25p as stockbroker WH Ireland completed the foreshadowed placing, raising pounds 700,000 at 2 1/8p. The cash will go towards the signalled energy acquisitions in Colombia.